The brief expectation that labour market problems in the US had subsided was hurt yesterday as a report showed that the number of workers filing for unemployment benefits rose to a 5 year high. This paints a confusing picture for today’s Non-Farms payroll announcement with analysts’ expectations varying by as much as 100,000 workers. Needless to say volatility on dollar crosses is all but assured. Poor growth data also hurt the greenback yesterday; the US economy grew at 1.9% on an annualized figure, lower than 2.3% that economists expected.

As we thought yesterday Euro HICP rose above the 4.0% level justifying the ECB’s hawkish stance against inflation. Euro was also helped by a German unemployment release that showed 20,000 more Germans in employment than a month ago.

Today will of course be dominated by US Non-Farms (13.30) but UK PMI (9.30) may surprise to the downside and weigh on sterling sentiment.

Have a great weekend.

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Disclaimer: The above comments are only our views and should not be construed as advice. You should act using your own information and judgement. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgement as of the date of the briefing and are subject to change without notice.Any rates given are “interbank” i.e. for amounts of £5million and thus are not indicative of rates offered by World First for smaller amounts. E&OE. Definitions of jargon/market terms can be found in our Glossary of Foreign Exchange Terms.